Good day, and thank you for standing by. Welcome to the Q2 2021 Kingsoft Corporation earnings conference call. I would now like to hand the conference over to our first speaker today, Ms. Francie Lu. Please go ahead.
Thank you. Ladies and gentlemen, good evening and good morning. I would like to welcome everyone to our 2021 second quarter and interim results earnings call. I'm Francie Lu, the IR Director of Kingsoft. I would like to start by reminding you that some information provided during the earnings call may include forward-looking statements which may not be relied upon in the future for various reasons. These forward-looking statements are based on our own information and information from other sources which we believe to be reliable. Please refer to the other publicly disclosed documents for detailed discussion on risk factors which may affect our business and operation. Having said that, please allow me to introduce our management team who joined us today. Mr. Tao Zou, our Executive Director and CEO, and Mr. Francis Ng, our Executive Director and CFO. I'm turning the call to Mr. Tao Zou. Tao Zou.
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Good evening, everyone. In the first half of 2021, all of Kingsoft's businesses have been developing steadily. As the whole society deepens its digital transformation, Kingsoft Office Group has seized the opportunity and continued to promote the strategy of multi-screen, cloud, content, AI, and collaboration. In the online game business, we continue to focus our strategy on premium games, increase our investment in R&D, and continuously expand new game genres. In the first half of 2021, our total revenue came in at RMB 3,039 million, up 17% year-on-year, and our office software and service business reported a strong year-on-year growth of 70%. With the robust revenue growth of office software and service business, our total revenue in the second quarter was RMB 1,480 million, up 4% year-on-year. Now I will turn the call to Francis, our CFO.
Thank you, Fancie. Good evening, everybody. Kingsoft Office achieved outstanding performance during the second quarter. As the localization project has entered a mature period and customer demand increased significantly, Kingsoft Office Group continued to witness a strong revenue growth from the localization project during the quarter. With the enhanced synergy between the subsidiaries, Beijing Suwell Technology Limited and Kingsoft Office Group, the fixed layout document format standard has been increasingly adopted by the market, further optimizing the localization business ecosystem. As a premium service provider of cloud and collaboration office solutions, we effectively promoted the cloud service migration and penetration in the government and enterprise market, and it brought us strong year-over-year revenue growth for the sustainable licensing business. Kingsoft Office Group has also continued to develop the micro, small, and medium-sized enterprise market.
As of June 30, 2021, over 1 million of micro, small, and medium-sized enterprises covering 19 industries are registered users of WPS Plus. Kingsoft Office Group organized the 2021 Office Application Developer Conference in June and launched WPS 365 Open Platform, our first product enabling global office application developers to facilitate a digital office as well as digital transformation in the government and enterprise market in China. Meanwhile, Kingsoft Office Group has continued to optimize our user experience and improve its customer loyalty through the application of cloud and collaboration services. We continue to enhance the penetration within the public cloud market and promote the growth of subscription service business. During the quarter, Kingsoft Office Group launched various new functions for WPS membership services and further optimized the user experience.
In April, Kingsoft Office Group organized a content ecosystem conference in Wuhan and strived to promote the transformation of our core WPS products from office tool to office services. In the first half of 2021, Kingsoft Office Group began the transformation of internet advertising business. We took the initiative to further adjust the advertising strategy to reduce interruption from advertisement to users and enhance users' cross-platform collaboration experiences. During the second quarter of 2021, the internet advertising and promotion services business maintained a steady year-on-year growth with an increase in user base, while its proportion in office software and services business revenue continued to decline. In the second quarter, the online game business continued to enhance the IP value of JX series and expand the development of the new game genre. In April, the JX1 Mobile was successfully released in Vietnam.
Among all role-playing games, the JX1 Mobile ranked first on both iOS and Android download charts in the first month of its debut. In May, the first-person shooting game, Bullet Angel, was first released in Southeast Asia and got recommended by Google Play. In June, War of the Visions: Final Fantasy Brave Exvius, the latest game of the Final Fantasy series, developed by Square Enix, was released in China, was recommended by App Store. In the coming quarter, the online game business will continue to focus on the long-term development of classic IPs and promote the launch of new games. We will celebrate the 12th anniversary of JX Online 3 PC game and launch a new expansion pack to further strengthen the longevity and vitality of our core IP.
In addition, JX World 3 mobile game will be launched within this year with a comprehensive upgrade in its visual design and gameplay. I will now discuss the Q2 and first half of 2021 operation and financial results. I'm starting from Q2 using RMB as the currency. Revenue increased 4% year-over-year and decreased 5% quarter-over-quarter to RMB 1,488 million. The revenue split was 47% for the online game and others, and 53% for the office software and services. You notice that this is the first time that the revenue of office software surpassed the revenue from our online game and others. Revenue from our online games and other business decreased 22% year-over-year and 12% quarter-over-quarter to RMB 693 million.
The year-over-year decrease was mainly due to the decline in revenue from JX Online 3 as a large-scale expansion pack successfully launched at a relatively high base following the increase caused by the pandemic in the second quarter of 2020. The quarter-over-quarter decrease was largely due to the decreased revenue from existing games, partially offset by the revenue contribution from the new launched mobile games. Revenue from office software and services business increased 47% year-over-year and 2% quarter-over-quarter to RMB 786 million. The year-over-year increase was largely due to strong growth of licensing business and sustainable growth of subscription services business. The revenue growth of licensing business was driven primarily by increasing demand for localization, as well as cloud and collaboration services from government and enterprises.
The increase in subscription service business was mainly due to the growing demand for cloud and collaboration services, and enhancement of user stickiness from personal user. Cost of revenue increased 25% year-over-year and 11% quarter-over-quarter to RMB 272 million. The increases were mainly due to the greater service and bandwidth costs, as well as purchasing costs of services and product in line with the expansion business of Kingsoft Office Group. Gross profit kept flat year-over-year and decreased 8% quarter-over-quarter to RMB 1,208 million. The group's gross profit margin decreased by 3 percentage points year-over-year and 2 percentage points quarter-over-quarter to 82%. Our R&D expenses increased 36% year-over-year and 8% quarter-over-quarter to RMB 532 million. The increases were mainly attributable to the increased personnel-related expenses. Selling and distribution expenses increased 61% year-over-year and 52% quarter-over-quarter to RMB 310 million.
The increases were mainly due to the higher personnel-related expenses and an increase in marketing and promotion spending. Administrative expenses increased 31% year-over-year and decreased 10% quarter-over-quarter to RMB 133 million. The year-over-year increase was primarily due to an increase in personnel-related costs. The quarter-over-quarter decrease was primarily attributable to a decrease in professional services fees. Share-based compensation costs increased 11% year-over-year and 28% quarter-over-quarter to RMB 441 million. The increases were primarily reflected in new grants in awarded shares to the selected employee of certain subsidiary of the company in the second quarter 2021. Operating profit, excluding the impact of ESOP, decreased 54% year-over-year and 50% quarter-over-quarter to RMB 270 million. Net other gains were RMB 48 million, compared with the losses of RMB 105 million in the corresponding period of last year, and gain of RMB 33 million in the first quarter of 2021.
The gains in the second quarter 2021 were mainly due to fair value gains on financial instruments at fair market through profit and loss. The losses in the second quarter 2020 were primarily due to loss of deemed disposal of an associate and the impairment provisions for certain investee companies. We recorded share of losses of associate of RMB 211 million, compared with share of losses of RMB 173 million for the second quarter of 2020, and a share of losses of RMB 225 million for the first quarter of 2021. The losses in the second quarter of 2021 were mainly due to the losses recognized in Kingsoft Cloud and Cheetah Mobile. The losses in the second quarter 2020 and the first quarter 2021 were mainly due to losses recognized in Kingsoft Cloud in this quarter.
Income tax credit was RMB 26 million, compared to the income tax expenses of RMB 83 million for the second quarter of 2020 and RMB 66 million for the first quarter of 2021. The significant decrease were mainly attributable to the combined effect in the second quarter of 2021. First, the recognition of tax credit as certain subsidiary were qualified as national key software enterprises for the year 2020. Second, the decrease in profit of online game business. Lastly, the specific deferral tax impact. As a result of the recent discuss about, the profit attributable to the owners of parent, including those from continuing operation and a discontinued operation, was RMB 49 million for the three month ended 30th June 2021. Compared with the profit of RMB 9,151 million and a profit of RMB 117 million for the three month ended June 30th, 2020 and March 31st, 2021, respectively.
Profit to owner of parent, excluding ESOP, was RMB 72 million. Profit of RMB 9,194 million and a profit of RMB 140 million for the three month ended June 30th, 2021, June 30th, 2020 and March 31st, 2021, respectively. The net profit margin, excluding ESOP, was 500%, 9% for the three month ended June 30th, 2021, June 30th, 2020 and March 31st, 2021, respectively. Now on the first half of 2021. Revenue increased 17% year-over-year to RMB 3,039 million. Online games and others make up 49% and decreased 12% year-over-year to RMB 1,482 million. Office software and services make up 51% and increased 70% year-over-year to RMB 1,557 million. GP margin decreased by 1% percentage point year-over-year to 83%.
As a result of the recent discussion about, profit attributable to the owners of parent, including those from continuing operation and the discontinued operation, was RMB 211 million, compared to a profit of RMB 9,249 million in the prior year period. The net profit margin excluding ESOP was 7% and 211% for the six months ended June 30th, 2021, and June 30th, 2020, respectively. On our statement of financial position, we have cash resources of RMB 18 billion as at June 30th, 2021. Net cash from operating activities was RMB 869 million and RMB 1,308 million for the six months ended June 30th, 2021, and June 30th, 2020, respectively.
In the first half of 2021, we achieved a stable performance of our core business. Looking forward to the coming quarters, we will continue to invest in our R&D and technological innovation, enhancing technological capabilities, and develop new products and services. We strive to bring the best experience to our user and customer. We are committed to sustainable growth of our business, bringing the long-term value in terms of returns of our customers and achieving a win-win situation for our partner. We may now start the Q&A.
Hi, operator. We're ready for the Q&A session.